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Technology Stocks : Safeguard Scientifics SFE

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To: michael r potter who wrote (2225)2/4/1999 1:57:00 AM
From: michael r potter  Read Replies (2) of 4467
 
Re. #2225. "...from the standpoint of expected money flows, risk in SFE may be quite small at this point [say$5-$8]." Using the logic in that posting, a different conclusion could be reached. Money flows could dictate a much higher risk than $5-$8. Why? The next internet offering probably won't occur for an eternity [now defined as 6-9 mo. in this market]. Will enough new converts be persuaded to buy that early and pay increasingly higher prices? With V-net coming soon, there has been a sense of urgency to get in and pay up if need be. After the offering, that will be gone for some time. Sellers will likely be out in force coincident with the offering. If there is a slackening of buy interest- money flows in [compared to the last 30 days], prices could easily come down from whatever the high is by more than $5-$8. Traditional value buyers won't step in to take up the slack without prices being a lot closer to $30. One possible outcome would be a larger point decline than that indicated only coming from a higher peak level. The main value to these exercises, IMO is to be alert to possible outcomes that may be coming up so that one is better able to analyze them in real time and make informed as opposed to emotional decisions. Mike
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